Nearly a year ago, online job marketplaces Elance and oDesk decided that they were better off working together rather than competing against one another. As a result, they merged to create a company called Elance-oDesk to dominate the market for connecting users with short-term and freelance jobs online.
Today Elance-oDesk is announcing that it has brought on an additional $30 million in funding led by Benchmark Capital, which it will use to further investment in its products and expand into new markets. In addition to Benchmark, additional shareholders that include T. Rowe Price, FirstMark, Sigma West, NEA, and Stripes Group also participated in the round.
Elance-oDesk offers up a platform to connect businesses looking for short-term and freelance help with online workers who have time to do the jobs available. It offers both hourly and milestone-based gigs for workers, and handles all invoicing and payment processing, ensuring both quality of work and timeliness of pay.
Thanks to the movement toward more temporary work situations both in the U.S. and globally, that segment of the market is growing fast. Also growing is the quantity of freelance work that is being done online, which of course benefits the company. To make it easier and faster to connect companies and workers, the Elance and oDesk saw an opportunity to combine their technologies and improve both systems.
So what’s happened since the merger? After announcing the deal last December, the companies closed and officially became one organization in late March this year.
In the nearly eight months since, Elance-oDesk has been working to consolidate technology between the two services and has invested in improving both its matching algorithm and collaboration tools it provides to businesses and workers. And while the merger has brought some “synergies” between the two entities, the company continues to grow — it had about 200 employees combined at the time of the announcement, and will have a headcount of about 300 by the end of the year.
Its business also continues to grow. Elance-oDesk now has 9.3 million freelancers and 3.7 million businesses on the platform, both of which are up pretty dramatically from a year ago. It also claims 2.7 million annualized job postings being put up, with workers making $900 million in annualized earnings.
The new money comes on top of pretty sizable investments already made in both Elance and Odesk. Between them, the two companies had raised $138.8 million in funding combined, which brings total capital raised to nearly $170 million.
That might seem like a lot, but it pales in comparison to the global market opportunity, according to CEO Fabio Rosati. He estimates the global freelance market is somewhere between $2 trillion and $3 trillion globally, and only a small portion of that is online today.
To reach that global market, Elance-oDesk will use the funding to improve its technology — including its matching tools to reduce the amount of time it takes for businesses and workers to connect. The company is also making a big push behind its collaboration tools, which helps freelancers chat and coordinate on projects with the companies they’re working for.
Elance-oDesk also hopes to invest further in reaching new markets and becoming truly global. While it already has freelance workers around the world using its platform but the company sees a bigger opportunity to take advantage of marketplace changes, especially in places like Northern Europe and some parts of Asia, Rosati said. It’ll also be looking to create more tools for enterprise users over time.
Feature image by Brit Fray for Elance-oDesk